What Can a Power of Attorney Do — And What Can’t They Do?
Power
Does the Agent Have Authority?
Explanation
Can an attorney-in-fact sign for the principal?
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If a principal becomes incapacitated, they may no longer be able to sign legal documents themselves. In such cases, the attorney-in-fact can sign documents on the principal’s behalf.
When doing so, the attorney-in-fact should clearly indicate that they are signing in a representative capacity. The signature typically includes the principal’s name, the agent’s signature, and the agent’s title, “attorney-in-fact.”
Can an attorney-in-fact manage property?
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It is important for attorneys-in-fact to understand the difference between managing property and disposing of it. Managing property may include tasks such as paying property taxes, arranging maintenance or funding repairs and improvements.
While most financial attorneys-in-fact have authority to manage a principal’s property, they must be granted authority to dispose of it. In other words, they would need express authority to sell or otherwise transfer ownership of the property.
Can an attorney-in-fact sign loan documents?
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Attorneys-in-fact acting under a POA that specifically grants authority over financial or legal transactions may generally sign loan documents on the principal’s behalf. However, doing so must serve the principal’s best interests, and the transaction must comply with any applicable requirements of lenders, institutions or relevant third parties.
Can an attorney-in-fact override a conservator?
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A conservatorship may be established even when a power of attorney exists. This typically occurs if the POA fails to adequately address the principal’s needs or if the attorney-in-fact is acting improperly.
When a conservatorship is created, the court may suspend or revoke the existing power of attorney.
Can an attorney-in-fact keep family away?
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An attorney-in-fact generally may not arbitrarily prevent family members from visiting the principal. In many situations, restricting access without justification can raise concerns about potential misconduct.
That said, if an attorney-in-fact acting under a medical POA reasonably believes that family visits may harm the principal’s health or wellbeing, some restrictions may be appropriate. Even then, such measures are typically considered a last resort.
Can an attorney-in-fact revoke a power of attorney?
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An attorney-in-fact cannot revoke a power of attorney. However, they may decline the appointment or resign from their role as agent.
A principal may revoke a POA at any time, provided they still have the necessary mental capacity. If the principal lacks capacity, a concerned party may petition the court to invalidate the POA, but valid legal grounds must exist for the court to do so.
Can an attorney-in-fact change power of attorney?
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Only the principal — provided they have the required mental capacity — may modify or amend a power of attorney.
Can an attorney-in-fact create, amend or revoke a will?
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Only a principal with testamentary capacity may create, amend or revoke a will.
Can an attorney-in-fact transfer money to themselves?
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Self-dealing is generally prohibited under a power of attorney. An attorney-in-fact may only transfer money or assets to themselves if the POA expressly authorizes compensation or self-gifting.
Even when such authority exists, the agent should maintain detailed records of all transactions conducted under the POA.
Can an attorney-in-fact close a bank account?
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Closing a principal’s bank account after their death is typically the responsibility of the personal representative of the estate, not the attorney-in-fact.
However, while the principal is still alive, an attorney-in-fact with financial authority under the POA may have the power to close a bank account if doing so serves the principal’s best interests and falls within the scope of the authority granted.
Can an attorney-in-fact withdraw money after death?
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All powers of attorney end upon the principal’s death. If an attorney-in-fact withdraws money from the principal’s bank account after learning of their death, they may face legal consequences for misusing the POA.
Funds withdrawn by an agent who was unaware of the principal’s death may need to be returned, but the agent generally will not face personal liability if the action was taken in good faith.
Can an attorney-in-fact delegate authority?
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An attorney-in-fact may hire third-party professionals — such as accountants, financial advisers or attorneys — to assist with their duties. However, they cannot completely delegate their responsibilities to someone else. Ultimate accountability remains with the attorney-in-fact.
Can an attorney-in-fact give legal advice?
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An attorney-in-fact may provide legal advice only if they are a licensed attorney.
Despite what their title might suggest, an attorney-in-fact cannot practice law, draft legal documents or provide legal counsel unless they are properly licensed.
That said, seeking guidance from an attorney can be valuable when navigating complex financial, medical or legal decisions.
Can an attorney-in-fact appoint another attorney-in-fact?
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An attorney-in-fact may decline the appointment or resign from their role, but they typically cannot appoint their own replacement.
In most cases, if the named agent is unable to serve, a successor agent listed in the POA has priority to act.
If no successor is named, or the successor declines, the court may appoint a conservator to manage the principal’s affairs.
Can an attorney-in-fact cash a check after death?
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An attorney-in-fact may not take any actions using a POA after the principal’s death, including cashing checks.
If a check arrives after the principal’s death, it should be immediately turned over to the personal representative of the estate.
Can an attorney-in-fact make gifts?
Express authority required
An attorney-in-fact may make gifts only if the POA explicitly grants that power and the gift aligns with the principal’s best interests or objectives.
Can an attorney-in-fact change beneficiary designations?
Express authority required
An attorney-in-fact may alter beneficiary designations — such as beneficiaries on bank accounts and life insurance policies — only if expressly authorized to do so in the terms of the POA. The alterations must also be in the best interests of the principal and align with their goals.
Can an attorney-in-fact create, amend or revoke a trust?
Express authority required
An attorney-in-fact may transfer assets into a trust, and in very narrow circumstances, may be able to amend the trust or revoke it — provided the POA grants express authority.
That said, they cannot create, amend or revoke a trust after the principal’s death, since a POA automatically expires at that time.
Can an attorney-in-fact change ownership of property?
Express authority required
Attorneys-in-fact who intend to gift, transfer or sell property — actions that change ownership — must have express authority in the POA for those actions to be valid.
Generally, attorneys-in-fact with financial or legal powers have authority to manage property, but selling or transferring ownership requires explicit authorization.
